How to Evaluate an Outsourcing Provider

How to Evaluate an Outsourcing Provider

You have now done the math and noticed that outsourcing is efficient and will save you lots of money and manpower. The next step is for you to go ahead with your outsourcing plans. One of them is choosing an outsourcing partner. It’s one thing to decide that outsourcing is good for your company, but another to find the right partner to get the job done.

In this phase, the partner you choose will determine whether you will achieve the results you are looking for or you will lag. When evaluating such a decision, the ability of your vendor to fulfil your requirements is an important consideration. Here are the criteria you need to use to evaluate your vendors or partner.

Defining What You Want

This is like a client-vendor relationship. It’s important to let your outsourcing partner know what you intend to draw out of the relationship. Defining the scope of tasks to be outsourced and their intended benefits is extremely critical. Get your management or team together and discuss your goals and the list of tasks the organisation needs to be outsourced. The second thing you will need to do is list the critical processes that need to be outsourced. Best of all, the procedure to be followed by the outsourcing team. You can also create charts or systems that need to be followed. At the end of the day, it is you who knows your business better than them. The more detailed you are in your requirement, the more you make the job easier for them.

Industry Experience

There's a way of evaluating your outsourcing service provider that most businesses overlook. You need to evaluate the provider based on quality, quantity, and industry level experience. You can do this by tracking their client records to find out whether their clients are happy with the services or not. While getting tasks done from your outsourced partner, its important to understand the experience and expertise they come with. This can be taken as an interview, a review for the company you intend to outsource to. Understanding how long they have been around in the Business, analysing while holding preliminary conversations whether they speak the language you want to hear and reading a bit about them will help your decisions get easier. Since your business is growing, you also need to figure out if the outsourcing company can support you when you diversify in the future. That is why you must evaluate your vendor with a sample of work. That way, you will know whether the company can meet your expectations or not.

The company that you also choose to work with must have adequate knowledge and experience to qualify for the tasks you have. What you can do is to ask them questions about the kind of projects they have handled in the past. Questions like, what did you like about this project? What was the most challenging part about it? Do you have team members with these skills and what is their experience? The more questions you ask at this stage, the more confident you will be whether they can handle the job or not.

Ask for Work Samples

Before you outsource any project to the outsourcing company, you must know their background. That will give you a better understanding of how they treat their clients and the delivery of their services. The best thing you can do is to request feedback from their past clients to find out the scope and quality of services. You can also inquire about the challenges they faced and how the team solved it. It’s okay to ask for references or work samples of tasks performed by them earlier. This gives you confidence that you are dealing with the right company. In doing so, while speaking with them, if they are able to help you understand how they achieved the result they show on the work sample, you have you had made the right decision. If possible, you can ask them for a portfolio of their work or prototypes, so you have a deep understanding of their output before you sign the contract.

Assessing their Technical Expertise

The outsourcing provider needs to explain the methodology they use to manage their projects, track their results, and solve their issues so you understand how they will handle your projects. That said, the outsourcing partner you choose must have excellent project management skills and quality control. Also, if they have a business continuity plan, assure you of uninterrupted services and support.


While making a decision in taken to outsource a particular task, this is probably the most important factor on the minds of Management. Remember, companies who quote a lesser price are not necessarily the best ones to test with. Similarly, companies who boast of a higher price and quality, are not necessarily the best ones either. Determine the price internally at which you wish to get the task done. Negotiating too much on the price may lead to the company not picking up the project itself. Are they not an entity, by themselves? Depending on various factors such as: longevity of the company in the domain, expertise you feel they have an advantage on, how comfortable do their representatives make you feel when you speak with them on a possible partnership, are all factors that you need to consider before setting a price.

Communication and Client Management System

When outsourcing any project, communication is vital to the success of the project. Excellent communication will ensure that everyone's expectations are met and you guys are on the same page. One thing you need to ask is their mode of communication. Outsourced companies should be best at this. Communication is their mainstay and that is easily identifiable in the way they respond to you. Such companies also are well aware that projects are time bound. Each activity needs to be completed within certain time frames.

What do they use to communicate with their client? Do they use email, phone, or other messaging services like WhatsApp? If you are also in a different time zone, you need to know their working hours and agree on the time of communication so that you don't have gaps in communication.

Test their Competency

Every business person will tell you that outsourcing carries some risk which most people don't love. Imagine feeling confident outsourcing the work only to come back with lots of revision or to turn out bad. It is a complete waste of time and money for your company. What you can do here is to offer the provider one small project to test their core skills. If the first few projects turn out well, that's when you can outsource the entire project. A little test will expose their side of work and you can use that to gauge their communication skills, quality, and support. That way, you won't be risking your time and money, which can hurt your company.